All Forum Posts by: Roi C.

Hi @Matthew Teifke, thank you for your input.

If that number is not public, how would a person know how much excess funds he can claim after the sale, if any at all? There must be some way to get to that figure.

Hey Y'all,

I am looking at some of the Harris County tax deeds that were sold on Tuesday (12/5). In the online search results I'm able to see the status of each property. Some were cancelled, stuck off or held for future sales, and some show a status of "Sold".

Is there any way for me to see what was the highest bid? Or in other words, how much these properties actually sold for?

Thanks!

@Joseph Pond First of all, thank you for your reply!

Second, real estate investing is not my full time job currently, I have other sources of income so a little bit of cash flow every month is not going to make any difference to me at the moment.

As I also said in the initial post, the areas that I'm looking at will not produce any cash flow at the moment. Best case would be to purchase an old home that requires massive renovation, get 0 cash flow for it, and hold it for several years. I believe that after several years the home will be worth at least 50% more. After prices go up it will be worth selling or renting at higher price, although rent prices here never go up at the same rate the selling prices do. Keep in mind that this whole time I will have to deal with tenants and fix issues as they arise.

I studied other similar areas in the city, where similar revitalization projects have already finished, and these neighborhoods are now completely transformed. I saw very clearly that the "older houses" that have been renovated (which by the way look very nice) are selling for 1/2 - 2/3 from what a new modern house is selling for. Rent prices are also about 1/2 - 2/3 from what a modern house is renting for.

After I saw this I thought to myself that If I am playing for the long run and I don't need cash flow right now. I might be better off with a piece of land which will eventually have a new modern house built on it. That would be more beneficial if I want to sell, and also more beneficial if I want to lease it.

As to your question, why should I wait and not build on it right now? For the simple reason that these neighborhoods are still transitioning, If I build a really nice house on it right now, I'm not convinced that I'll be able to lease it at the price that I am expecting, and in several years when the neighborhood is transformed, I'll have a less appealing property compared to the other new homes that will be built there in the future. I don't like the idea of being a pioneer and revitalizing the neighborhood myself, I'll leave that to the huge developers that buy a whole street and build town homes and apartment complexes on it.

Also, after Hurricane Harvey contractors here are more expensive due to the high demand, so I would like to let that slow down a bit as well.

Hi Elizabeth, I'm not sure I exactly understand what you meant here. Are you saying that new modern town homes might impact the existing community negatively? It's true that once new town homes are built all over, it will loose its "historic" feeling. But why would that be a problem?

Hi, thank you for your replies.

The issue that I'm facing is that in the areas I am referring to, in order to purchase house in my budget it will not be in livable condition, and would require an expensive rehab, which means more money out of my pocket now. Sure, I can rent it out later for about $1500 or a little bit more than that, but I think that in several years with the rate that the new development is going I would be much better off with building a new home that can sell for 500k+

@Matthew Paul - Do you have any good way to estimate what your building costs will be?

Hi @Jorge Quintero 

Welcome to BP, I wish you a lot of success with your investments. I'm kind of new here myself.

Do you have specific areas in Houston that you are looking into?

Hey,

I'm looking to purchase a property in Houston, TX in a transitioning area that I believe will appreciate significantly in value. I might still be able to find some deals on old properties for around $160k-180k in these areas (and some of them might require a significant rehab). After running the numbers, it looks like the monthly cash-flow on these properties will be close to 0 after rehab is done and properties are rented. I estimate that these houses will be worth much more in 4-5 years, and I don't have an issue with waiting that time.

This got me thinking, why would I want to own a property and deal with tenants and constant repairs just to get some value in several years?! I might be able to purchase a vacant lot for about 50k, pay the property taxes on it, and when the time is right I can build a nice modern house on that lot.

I've never purchased a vacant lot, or dealt with new construction before. I did however read the eBook BiggerPockets wrote with J. Scott about his new construction diary, which was a very interesting read, and made me think about this seriously.

Does anyone here have any experience with buying land, holding it for several years and then developing on it? What are the pros and cons of this approach? Do you see any major pitfalls with this approach?

Are these any expenses other than property tax, and maybe mowing the grass, that I need to take into account when holding a vacant lot?

In a city like Houston where we don't have city zoning laws, I assume it should be easier to get permits and get a construction project going. What other issues should I look out for? The last thing I want is to purchase a piece of land that will be "unbuildable" or will have too many restrictions on it.

Thanks a lot!

Hey,

You can go to HAR.COM to find properties. When you click on a listing you'll see all the basic information you need to start with, the subdivision should also be listed there. I personally prefer using the map tool in areas that I'm interested in, because searching by zip code is too broad, and when searching by subdivision, properties will sometimes pop-up right outside the border of the subdivision, and I don't want to miss those.

In the search results you will typically see the results in green color on the map, these are the properties that are currently available for sale, and the yellow/orange listings are properties that have been already sold, or have a contract or option period on them. In order to get the exact price a property was sold for you'll need to contact a Realtor that can send you reports directly through the MLS (which is also used by HAR.COM).

When comparing properties try to compare apples-to-apples, not apples-to-oranges. Meaning, compare properties that are in similar condition, with similar beds, baths and sqft. Comparing a 3-bed 1200sq/ft home to a 5-bed 2500 sq/ft home will not give you reliable data, even if the properties are in the same neighborhood. Also, with the crazy price increases we've seen here, when looking at prices of homes that have already been sold, try to focus on properties that were sold within the last 3 months.

I wish you good luck and success with your searches!

Hi,

A good friend of mine who's a general contractor advertises and gets a lot of his leads from Thumbtack. It's true that they are a lead generation website and contractors pay in order to get leads. As far as the quality of contractors, I can't say because I've never used someone from that website.

I personally try to avoid contractors that pay to get my lead, because ultimately their advertisement costs are rolled onto me. Now, it really depends on the scope of your project because these fees might be really low and insignificant compared to the total cost of the project. I think there's a fundamental problem with that pay-per-lead approach for us the consumers, I want a contractor that's good and can be recommend by previous customers, not a contractor that spends the most dollars to show up first place on my screen.

@Kevin Romines @Stephanie Medellin

Thank you both for your replies. 

I'll call more lenders until I find one that is actually willing to take a few minutes and talk. I guess I just spoke with some reps that were having a bad day. 

Thank you also for pointing out that I cannot pull the rehab money within the first 6 months when refinancing. That is extremely important to me unless the rehab only covers small cosmetic upgrades. I'll include this as a question to the lenders I speak with to see if they know what they're talking about.